Moderate rates set for insurance exchange

Sep. 25, 2013

Photo provided by Photos.com

Written by

John Russell

The Indianapolis Star

What you will pay

Average monthly premiums for Hoosiers buying health insurance through the new exchanges.

CONSUMER SCENARIOS

Cost

Family of four with income of more than $94,200 a year (ineligible for subsidies)

$961

Family of four with income of $50,000 (and getting subsidies)

$282

A 27-year-old with income of more than $45,960 (ineligible for subsidies)

$265

A 27-year-old with income of $25,000 (and getting subsidies)

$145

SOURCE: U.S. Department of Health and Human Services NOTE: The family of four in this example consists of one 40-year-old, one 38-year-old and two children under 18.

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A family of four in Indiana making $50,000 a year could expect to shell out $282 a month for a typical health insurance plan under federal exchanges that open for enrollment next month.

That figure is exactly the same as the national average, according to preliminary figures rolled out on Wednesday by the federal government.

But prices vary widely for various types of consumers, depending on their incomes, ages, family size, tobacco use and other variables. All of those factors could leave some people scratching their heads as they try to navigate the system.

The health insurance exchanges are set to open a six-month enrollment period next week.

The monthly premiums for Hoosiers are likely to range from about $100 a month for some single adults to $1,000 for a family of four with an income of more than $94,200.

The Department of Health and Human Services gave the first look at rates for Indiana and 35 other states that have chosen to give the federal government full or partial control over the health exchanges in their states. The remaining states are running their own exchanges.

The rates released Wednesday have not been finalized and could change in coming weeks.

The marketplace allows individuals, families and small businesses to shop and compare prices for health insurance from dozens of plans in Indiana, sometimes with federal tax credits that could provide a discount on the sticker price. Federal tax credits will reduce the costs for low-income adults.

The announcement of the rates comes amid an ongoing advertising war between supporters and opponents of the federal health care law.

Most Hoosiers will not need to worry about the exchanges, if they are covered by group plans through work. They can stick with their health plans.

The health exchanges are set up primarily for people who buy individual plans or who are currently uninsured. Indiana officials say about 178,000 Hoosiers now are covered through individual plans. They expect another 300,000 or more state residents would be eligible to enter the individual health insurance market next year.

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And they will find a wide variety of plans, prices and choices, according information rolled out by the federal government.

They can pick from four levels of coverage, from bronze to platinum. All of the plans cover the same benefits and cap annual out-of-pocket expenses at $6,350 for an individual, $12,700 for families.

The big difference is cost sharing through annual deductibles and copayments. Bronze covers 60 percent of expected costs; silver, 70 percent, on up to platinum at 90 percent. Bronze plans have the lowest premiums and the highest cost sharing.

A 27-year-old who chooses the bare-bones catastrophic care package could pay an average of $168 a month, a bit more than the national average of $129 a month.

If the 27-year-old wants fewer deductibles and co-pays, he could choose from an assortment of more expensive packages, ranging from an average of $200 a month to $332 a month. Each of those also cost more than the national average.

But a low-income family of four, qualifying for tax credits, could pay $46 a month for a basic plan — even cheaper than the price for a single individual. That’s because the tax credit is calculated under a complex formula that takes the difference between the cost of the second-lowest cost silver plan and the maximum payment determined by income. That $46 is in line with the national average.

That same family of four making less than $50,000 a year might instead choose a plan costing $282 a month, the same as the national average.

Prices in some surrounding states, including Illinois and Michigan, also are lower than the national average, while prices in Ohio are nearly identical to the national average.

The overview of premiums and plan choices comes as the White House swings into full campaign mode to promote the benefits of the Affordable Care Act to a skeptical public. Congressional Republicans, meanwhile, refuse to abandon their quest to derail “Obamacare” and flirt with a government shutdown to force the issue.